OT27054 - Abandonment and Decommissioning

Contributions to Trust Funds

Contributions may be made to Trust Funds set up to meet future decommissioning and abandonment obligations – effectively as an alternative to obtaining an abandonment guarantee.

These are likely to be capital in nature and thus not allowable in computing trading profits. Under current legislation, there is no provision under which relief can be given as capital expenditure. Any cases where a claim to relief is pressed should be referred to an Assistant Director.